Do I have to disclose my Contractor Invoices?

by Readers Question

14:39 PM, 4th May 2016
About 4 years ago

Do I have to disclose my Contractor Invoices?

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Do I have to disclose my Contractor Invoices?

A client, who I manage a property for, has requested a copy of my contractors direct invoices to me for her accountant.dislosure

I advised her the statements I provide are sufficient for her accountant and for tax purposes as they detail the cost she has been charged for the repairs. They are given from my limited company and have the registered company number on them.

My contractors invoices are addressed to me, are for my business purposes and are of no relevance to her whatsoever. What if I had done the work myself and there was no third party invoice?

In the past I have been burned with clients contacting my contractors directly and self managing going forward, benefiting from the relationship I had built up with the contractor. I cannot blame the contractor, as the client who approached them offered to pay more than my negotiated rates with them as they were saving on the management fee! I only found out as he accidentally invoiced me for a job!

I have now found new contractors and work closely with them and sure it would not be a problem going forward, but I feel strong armed into providing my invoices by using the excuse “my accountant needs them”.

Can I refuse? How far can I stand my ground? Surely documents relating to my business can be kept confidential?

Many thanks

Hemi



Comments

Hemi Tanna

12:54 PM, 6th May 2016
About 4 years ago

Thanks to everyone who has commented. I was just asking for help and guidance as someone relatively new to the industry and wanted to ensure I was acting in the right way and, to be honest, was worried the client was asking me to do something I didn't need to.

I will note here, I started at being a Property Manager by self managing my families portfolio and then, as more people (e.g. friend of a friend) approached me to help them, I decided to form a limited company and do it properly for them. I'm proud to say I've started a little business here now and pride myself on providing a fair and honest service to my clients. I take no mark ups, no commissions and I utilise buying power with contractors to lower prices of maintenance & repairs - I am a landlord first and foremost and have just decided to apply my way of managing my properties to help other landlords to manage theirs as they would themselves.

I just wanted to explain that to try to answer some of the comments insinuating I was being suspicious...actually I just lacked the experience to deal with that request.

I have in fact taken some very good advise on here and provided the invoice with blanked out information for other properties information. Many thanks all for your help

Adrian Jones

16:03 PM, 6th May 2016
About 4 years ago

I'm confused Hemi. You take no mark ups, commissions and utilise buying power to lower prices for the work you organise.

Yet a client has gone to a contractor direct to save your management fee.

Can you explain this as I'm intrigued.

Penniless Landlord

16:29 PM, 6th May 2016
About 4 years ago

Things like gas certs would have the contractors details on anyway, so worrying about them going direct due to sharing the invoices is irrelevant. If your passing discounts on to the landlords, it would be in your interests to push the fact to the landlord that by arranging the work for them they are getting a good deal; assuming your contractors are competitive in the first place.

My wife's agent wanted to charge us £80 per property for the gas safety check, but we deal directly with a reliable engineer who only charges £50 (that is his standard rate). There are some engineers locally that charge as little as £35 per property.

Most of the comments were suggesting that by not doing so, a client may have reasonable cause to be suspicious whether justified or not. Consider how it looks from the landlords position.

Simon Lever

11:24 AM, 9th May 2016
About 4 years ago

Hi Hemi

In the end it all comes down to your agreement with your clients and how well you service their needs.

The work that you have contracted out is on behalf of the property owner. Even if the invoice is made out to you it is a disbursement on behalf of the owner and I would expect a copy of the invoice, or relevant extract, to be made available to the owner and their agents.

There are good reasons for this, including but not limited to: who does the owner have recourse to in the event of bad or shoddy work, does the contractor charge a reasonable price, has there previously been a dispute with the contractor, what is the nature of the work (capital or revenue).

If your fees are based on a percentage of the invoice then you will be charging a mark up on the amount billed to you and it is reasonable for the property owner to confirm the original amount paid.

If you are worried about the owner going direct then you already have a problem. If they are not satisfied with your work and supervision they will go elsewhere anyway.

You could try putting a clause in your agreement that if your client goes directly to your contractors whilst you manage the property then they are still due to pay you your management charge but this could be difficult to police and they could just go to a different contractor anyway. Take advice if this is the way you wish to proceed.

Stan Barlow TEE LTD

11:33 AM, 9th May 2016
About 4 years ago

Hopefully there is a matter of trust that generally follows a period of satisfactory service?
Have you tried to discuss this with your client direct? It maybe something innocent. Is VAT involved?

Hemi Tanna

11:39 AM, 9th May 2016
About 4 years ago

Reply to the comment left by "Stan Barlow" at "09/05/2016 - 11:33":

Thanks Stan, that's exactly what I did. I asked a bit more detail in regards to what the accountant wants and provided the direct invoice with the details about other properties blanked out. Many thanks

Stan Barlow TEE LTD

12:54 PM, 9th May 2016
About 4 years ago

Reply to the comment left by "Hemi Tanna" at "09/05/2016 - 11:39":

Fine, we have offered a landlords service for over 20-years and never had a problem. Google my company at TEE LTD Cornwall for more info and by all means give me a ring.

Kathy Evans

22:06 PM, 14th May 2016
About 4 years ago

Reply to the comment left by "Romain Garcin" at "05/05/2016 - 08:59":

Why on earth can't you make a profit on repairs etc? If I outsource work for a client as part of my non-landlord business, I'll add mark-up - it's how the world works AND I see no need to tell them who did the actual work,. They get an invoice for the whole "project" from my Ltd Co and that's all they need for tax purposes. If I outsource photography for a website to a freelance photographer I feel no obligation to tell the client who the photographer was or that it wasn't my employee. Sounds like a client to ditch.

Ian Ringrose

23:05 PM, 14th May 2016
About 4 years ago

Because an agent is an AGENT of the landlord, so should not be putting on any martups, the agent charges a fee for being an agent, and that is ALL the money the agent should get from the landlord directly or indirectly.

The trades person is working for the landlord not the agent, therefore the invoice should never have been in the agents name.

Adrian Jones

10:46 AM, 19th May 2016
About 4 years ago

Kathy Evans - No problem with making a charge for organising work but the charge (normally 10% in my experience)should be made clear at the outset in the agreement between agent and landlord.

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